Bitcoin Slides Below $110K as Powell Dials Back Expectations for December Rate Cut
Bitcoin dropped sharply on Wednesday after Federal Reserve Chair Jerome Powell delivered unexpectedly hawkish remarks, casting doubt on whether another rate cut will come in December.
“A rate cut in December is far from a foregone conclusion,” Powell said during his post-meeting press conference, catching markets off guard after traders had priced in a 90% chance of further easing.
The Fed earlier announced a 25-basis-point reduction, bringing its benchmark rate to 3.75%–4.00%, in line with expectations. But the tone of Powell’s comments — and a split vote within the Federal Open Market Committee (FOMC) — turned the move into what analysts described as a hawkish cut. Kansas City Fed President Jeffrey Schmid dissented, favoring no change in policy.
Following the remarks, Bitcoin (BTC) slid nearly $2,000, dropping to $109,600 — down about 5% in 24 hours — erasing much of its earlier weekly gains. Stocks also reversed direction, with major U.S. indexes slipping into negative territory. The 10-year Treasury yield climbed eight basis points to 4.06%, while the U.S. dollar extended its advance.
According to CME FedWatch, market-implied odds for a December rate cut dropped to 69% from 90% earlier in the day.
Powell acknowledged “some cooling” in the labor market but stressed that inflation “remains somewhat elevated,” underscoring the central bank’s cautious approach amid economic uncertainty.
With the government shutdown and related data blackout limiting visibility into recent economic activity, analysts warned that future Fed decisions could become increasingly unpredictable.
“The data blackout makes it harder for policymakers to gauge real-time conditions,” said Marcin Kazmierczak, co-founder of RedStone. “That uncertainty alone could fuel volatility across bitcoin and broader risk markets into year-end.”
Traders in the crypto market also appeared unsettled by the shift in tone. Paul Howard, director at trading firm Wincent, said bitcoin remains within its broader $110,000–$120,000 range but noted that near-term sentiment has turned more cautious.
“This dip may offer short-term accumulation opportunities,” Howard said. “If macro conditions stabilize in November, we could see a rebound before year-end consolidation.”
Despite the rate cut, Powell’s comments reinforced that the Fed is not yet ready to pivot decisively toward looser policy — a stance weighing on risk assets, including digital currencies.
